Labyrinth Resources Expands Portfolio with Mulwarrie Acquisition and Capital Raising
LRL (LRL) Share Update November 2024 Tuesday 19th
Labyrinth Resources Acquires Mulwarrie Gold Project and Raises Capital
Labyrinth Resources Limited (ASX: LRL) has announced the acquisition of the Mulwarrie Gold Project from Genesis Minerals, alongside a significant capital raising effort to fund future exploration and development.
Instant Summary:
- Acquisition of 100% of the Mulwarrie Gold Project from Genesis Minerals.
- Mulwarrie has a JORC compliant Mineral Resource of 881kt at 2.8g/t Au for 79koz.
- Capital raising of approximately $19.5 million through a placement of shares.
- Genesis Minerals to become a strategic substantial holder in Labyrinth with ~7% stake.
Acquisition Details
Labyrinth Resources Limited has successfully acquired the Mulwarrie Gold Project, located in the Eastern Goldfields of Western Australia, from Genesis Minerals. This acquisition includes two granted mining leases, M30/119 and M30/145, and marks a strategic move to consolidate high-grade gold assets in the region.
The Mulwarrie Gold Project boasts a shallow JORC compliant Mineral Resource of 881kt at 2.8g/t Au for 79koz, offering significant growth potential that was previously constrained by tenure issues. The acquisition was settled through the issuance of approximately 17.86 million fully-paid Labyrinth shares, valued at $0.21 per share, with an additional $1.0 million milestone cash payment upon first commercial production from the tenements.
Capital Raising Efforts
In conjunction with the acquisition, Labyrinth Resources is conducting a capital raising of approximately $19.5 million. This will be achieved through the placement of around 92.86 million fully paid ordinary shares to institutional and sophisticated investors at an offer price of $0.21 per share. The capital raised will be directed towards drilling and exploration activities at Comet Vale, Vivien, and Mulwarrie, as well as potential strategic acquisitions.
Genesis Minerals has committed to participating in the placement, subscribing for $1.45 million, thus emerging as a substantial shareholder with a 7% stake in Labyrinth Resources. This strategic partnership is expected to bolster Labyrinth's exploration and development capabilities.
The acquisition of the Mulwarrie Gold Project and the associated capital raising are significant steps for Labyrinth Resources. This move not only strengthens their portfolio of high-grade gold assets but also provides the necessary capital to accelerate exploration and development activities. The involvement of Genesis Minerals as a substantial shareholder adds credibility and strategic value to Labyrinth's growth plans.
Investor Reaction:
Analysts are likely to view this acquisition and capital raising positively, given the potential for high-grade gold resource expansion and the strategic partnership with Genesis Minerals. The market may respond with increased interest in Labyrinth's stock, reflecting confidence in their growth strategy.
Conclusion:
Investors should keep a close watch on Labyrinth Resources as they move forward with their exploration and development plans. The acquisition of Mulwarrie and the successful capital raising position the company well for future growth in the high-grade gold sector.